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House Should Stand Firm and Kill the Wall Street Bailout

Posted on Oct 3, 2008

The people said no and, for once, the Congress listened. But all of the usual suspects, including both Senators John McCain and Barack Obama, rallied behind the administration’s ill-considered Wall Street bailout and pushed it through the Senate. Now the bailout’s supporters are going back to the House and hope to buy off enough votes to win passage tomorrow.

So ill-considered is this legislation, that no one—not President George W. Bush, not Treasury Secretary Henry Paulson, not Sen. McCain, not Sen. Obama—has been able to even justify the amount of money requested. When asked by Forbes.com to explain the number, a Treasury Department spokeswoman said, “It’s not based on any particular data point. We just wanted to choose a really large number.”

Upon such an arbitrary decision are the American taxpayers to be sacrificed.

Under these circumstances, the only way the administration and the congressional leadership of both parties can hope to win is to play fast and loose with the Constitution. This bailout obviously is a big money bill, authorizing $700 billion worth of asset purchases and raising the debt ceiling to cover the necessary extra borrowing. Yet the Constitution clearly states: “All bills for raising Revenue shall originate in the House of Representatives.”

This provision means what it says—money bills are supposed to start in the House. As Alexander Hamilton explained in the Federalist 66, “to secure the equilibrium of the national House of Representatives, the plan of the convention has provided in its favor several important counterpoises,” including “the exclusive privilege of originating money bills will belong to the House of Representatives.” But the Senate has tossed the nation’s founding document, which establishes the Senate, into the trash-bin. And House leaders evidently have no more respect for the traditional prerogatives of their own institution than for the Constitution.

Moreover, at a time when the national debt already runs $9.5 trillion, the fiscal year 2009 deficit is going to exceed a half trillion dollars, and the bailout would run an extra $700 billion. The administration and its allies are spending even more money in an attempt to win votes. They have added cash for hurricane disaster relief and for rural schools. They have larded the bailout legislation with tax breaks. And they have proposed to mandate increased mental health care coverage in private health insurance plans. The legislation will cost more than $100 billion over the next five years.

We can’t afford the bailout. And we certainly cannot afford the misnamed “sweeteners” intended to buy the votes of House members. Using money the government doesn’t have to persuade legislators to spend even more money they don’t have is a fiscal and moral outrage. Turning normal bills into fiscal Christmas trees is bad enough, but the administration’s and congressional leadership’s attempt to avoid a genuine vote on the merits of legislation so expensive and far-reaching is a travesty.

When it comes to protecting the taxpayer, there is no difference between Sen. Barack Obama and Sen. John McCain. In fact, the latter, a self-proclaimed taxpayers’ friend, has gone out of his way to disguise the fact he is voting for a pork-laden Wall Street bailout by calling the plan—which forces millions of average Americans who work for their salaries and pay their mortgages to bail-out a bunch of irresponsible borrowers, lenders, and investors—a “rescue.”

It is the American people who need rescuing from the likes of Sen. McCain. Members of the House have a responsibility to themselves, as well as the American people, to vote down the latest version of the Wall Street bailout.

It is a bad bill. It is bad for America. And it is an insult to the members themselves to suggest that their support can be so cheaply bought. “Country first,” says John McCain. This time, the country says no to the Wall Street bailout.

Libertarian Party presidential candidate Bob Barr represented the 7th District of Georgia in the U. S. House of Representatives from 1995 to 2003.

The Libertarian Party is America's third largest political party, founded in 1971. Our vision is for a world in which all individuals can freely exercise the natural right of sole dominion over their own lives, liberty and property by building a political party that elects Libertarians to public office, and moving public policy in a libertarian direction.